Warc Blog

Positive outlook for digital adspend

12 September 2013
LONDON: Digital publishers in the UK reported a 14% year-on-year rise in ad revenues during the second quarter and there was widespread expectation that growth would continue into the third quarter, a new study has revealed.

The Digital Publishers Revenue Index Report, carried out by Deloitte for the Association of Online Publishers, showed that online video led the way, increasing 21.1%, followed by recruitment, on 15.4% and sponsorship, up 14.9%. Display grew 11.7% while classified advertising was flat on 0.3%.

A total of 65% publishing respondents reported positive total advertising growth in the second quarter of 2013, with only 3% reporting negative growth.

"The second quarter ad revenue growth performance reiterates that seen for the first quarter," said Tim Cain, head of research at the AOP. "Once again premium content publishers' performance continues to exceed the online industry as a whole."

Howard Davies, Deloitte media partner, echoed the remarks on premium publishers, saying that growth was a reflection of their "investment in the quality of their inventory, adoption of new trading approaches, and the continuing appeal of high quality editorial content".

Cain also observed a shift in publisher sentiment during the second quarter, "away from cost-cutting and towards investment in new products and services" which he argued was indicative of a positive outlook for the coming quarter.

The AOP Sentiment Index Report, published at the same time, recorded 92% of AOP board members anticipating further growth in digital advertising in the third quarter, with a similar proportion saying that advertising revenue growth was their main business priority.

Just 33% saw cost reduction as a priority, compared to 46% in the equivalent quarter of 2012. In contrast, 67% were looking to introduce new products and services, up from 42% the previous quarter.

There was also a significant uplift in expectation of technology advertising spend, potentially driven by competition in the device arena.

Data sourced from AOP; additional content by Warc staff

 
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